Preferential Tax Refund For Foreign Invested Enterprises And Foreign Enterprises

Tax incentives for foreign investment enterprises and foreign enterprises to reinvest tax rebates (example): the foreign investors of foreign invested enterprises will reinvest directly in the enterprise and increase their registered capital, or invest in other foreign-funded enterprises as a capital investment, with a period of not less than 5 years. Investors will refund the 40% part of the tax on their reinvested part of the reinvestment portion, upon approval of the tax authorities.

Foreign investors will directly reinvest in China, organize and expand export enterprises or advanced technology enterprises, and foreign investors will directly reinvest profits from the enterprises in the Hainan Special Economic Zone in the basic construction projects and agricultural development enterprises in the Hainan special economic zone. If the business period is not less than 5 years, investors will be refunded and the enterprise income tax paid on the reinvested part will be refunded by the investor.

Foreign investors of foreign investment enterprises will directly invest in the enterprises or invest in other foreign-funded enterprises. If they reinvest less than 5 years, they should pay back the tax that has already been withdrawn. If the foreign investors invest directly in the enterprises held or expanded, they will not meet the standards of the export enterprises in the 3 years from the date of their production and operation or after 3 years of reinvestment. If the enterprise has been withdrawn from the advanced technology enterprises after being disqualified from the examination within 3 years after the enterprises begin production, operation or capital investment, the 60% of the tax refund has to be paid back.

Foreign investors should apply for tax refund to the original tax authorities.

The original tax authorities shall send the tax refund notice for reinvested foreign investors to the tax authorities where the reinvested enterprises are located according to the above tax refund procedures.

The tax authorities of the place where the reinvestment enterprise is located should examine and verify the implementation of the reinvestment according to the above management regulations. If it is found that there is no more than 5 years' withdrawal from the operation period after the reinvestment, or if the newly exported product export enterprise or advanced technology enterprise fails to reach the required standard within the prescribed time limit, the foreign investor shall pay or return part of the tax refund in accordance with the regulations to the tax authorities where the reinvestment enterprise is located.

A productive foreign invested enterprise in a special economic zone opened in September 1988, and its production and operation period is 20 years. It was profitable in that year, but the enterprise chose to calculate the tax exemption period from the next year.

Since 1994, it has been recognized as an advanced technology enterprise by the government authorities in the past years.

The following table shows the profit of the company from 1988 to 1998.

The unit: (10000 yuan), the annual profit of 1988198919901991, 1992199319941995, 199619971998, and 199619971998 yuan is 6050130-70320460580500650 730790, and the foreign investors of the company will earn 910 thousand yuan in 1992 and 1 million 770 thousand yuan in profits in 1995.

In the past 11 years, the enterprise has been allowed to receive Corporate Income Tax and the amount of reinvested tax paid by foreign investors (local income tax is 30%).

At the same time, both local income tax and corporate income tax are reduced or avoided.

Analysis: 1, in 1988, the profit was less than 6 months, and the tax exemption period can be calculated from the next year.

The tax payable in 1988 is 60 yuan (15% + 3%) = 108 thousand yuan.

(2) tax exemption in 1989 and 1990.

(3) 1991, 1992, and three tax in 1993.

However, in 1991, it did not have to pay taxes, but it could make up for its losses in the following year's profits. In 1992, it still had a profit of 2 million 500 thousand after making up the following: 1992, 1993, the amount of the income tax payable was 320-70 (460) x (15% + 3%) x 50% = 63.9 (10000 yuan) (4). From 1994 onwards, it has been recognized as an advanced technology enterprise for a number of years, and it can enjoy half a year's tax in three years.

The amount of income tax payable in the three years is 580 (500 + 650) x (15% + 3%) x 50% = 155.7 (10000 yuan).

(5) from 1997, we will extend the half tax preference.

In the 1997 and 1998 years, the amount of the income tax payable was 73 (790 +) x (15% + 3%) = 273.6 (10000 yuan).

(6) eleven years of total income tax = 10.8 + 63.9 + 155.7 + 273.6 = 504 (10000 yuan) (7). Because of the increase in the registered capital after reinvested in 1992, the tax can only be returned to 40%, but in 1992 it is half of the tax period. Therefore, the reduction factor should also be taken into account.

In 1992, the amount of reinvestment tax refund was 91 / 1 - (7.5% + 1.5%) x 7.5% x 40% = 3 (10000 yuan) (8). Since 1994, the enterprise has been identified as an advanced technology enterprise, which can be reduced by half tax in three years, and the tax rebate rate can be calculated by 100%.

In 1995, the tax refund amount of reinvestment was 177 / 1 - (7.5% + 1.5%) x 7.5% x 100% = 14.59 (10000 yuan). The total amount of reinvestment tax was 3 + 14.59 = 17.59 (10000 yuan).